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Saturday, 7 July 2012

A variety of policy recommendations have been proposed for the UAE banking and financial sector to enhance overall economic sustainability of the country and Dubai in the post-recession era, according to a latest study by the Dubai Economic Council, or DEC.
The Economic Policy and Research Centre, the operational arm of the DEC, recently conducted an economic policy study entitled “Soundness of UAE banking sector and macroeconomic conditions”.
The report focused on macroeconomic conditions and how they may affect soundness of UAE banking sector.

Investors will look to Saudi Arabia this week as the earnings-reporting season has got off to an encouraging start on the region's biggest bourse. Companies including the dairy and food producer Almarai, the property developer Dar Al Arkan, and Yanbu Cementposted profit increases yesterday.

"People are more conservative rather than risk-takers at the moment due to volatility on international, particularly European, markets," said Marwan Shurrab, the vice president and chief trader at Gulfmena Investments, an asset-management firm in Dubai.

Yanbu Cement reported a 44 per cent rise in second-quarter profit from a year earlier to 216 million riyals amid greater output and higher revenue.

The market for corporate lending in the Middle East virtually collapsed in the first half of this year, according to new data from the information business Thomson Reuters.

Figures show that syndicated lending reached just US$187 million (Dh686m) in the first six months of the year, down from $10.2 billion in the first half of last year, making it the slowest period in more than a decade.

The crisis in the euro zone, fears over global economic recovery, and pressures on banks' balance sheets are among the factors behind the dramatic decline, experts believe.

The gross domestic product (GDP) is projected to slow down this year and the next, partly reflecting conscious choices. The main reason for the expected economic slowdown reflects the undeclared moratorium of gas output.
Nevertheless, Qatari authorities have been sparing no time exploring all sorts of regional and international options aimed at achieving diversification and development of the country’s economy. The more recent examples entail Qatar Airways exploring the viability of entering Saudi Arabia’s domestic market.
According to the General Secretariat for Development Planning (GSDP), inflation-adjusted gross domestic product (GDP) growth should ease from 14 per cent in 2011 to 6.2 per cent in 2012 and still 4.5 per cent in 2013. GSDP’s qualification includes that of being a state entity with access to all information.

Aluminum production is tilting towards the Gulf-and industry giants Rio Tinto, Alcoa Inc. and Norsk Hydro ASA are betting heavily that the region can produce aluminium more cheaply and can grab global market share.
The rush to lower production costs is intense. The aluminium market currently is so oversupplied that market participants say half of the world’s production is unprofitable at current prices.
Producers and state-owned companies hope Gulf production can take advantage of low energy costs locally and lower shipping rates globally. Such a shift comes at the cost of more costly aluminium smelters in Europe and America.

Be careful what you wish for, they say. It might just happen, and when it does, it could bring its own regrettable difficulties, the very opposite of a blessing in disguise.
Even in these days of prospecting for and promoting alternative energies, striking oil on any significant scale or in its associated or derivative forms retains the money-spinning sense that its iconic image has suggested through the ages. Any country would want that.
As to the past, the Gulf might not have craved the mineral endowment which has defined its economic and geopolitical profile, but it naturally has benefited stupendously.

Statistics Centre — Abu Dhabi, or Scad, on Saturday said Abu Dhabi’s gross domestic production, or GDP, at current prices grew by 29.9 per cent from Dh620 billion in 2010 to Dh806 billion in 2011.
While releasing preliminary figures shedding light on the key developments in Abu Dhabi economy, Scad said the results demonstrate that the emirate’s economy has bounced to levels above those that dominated prior to the global financial crisis, giving it a huge competitive advantage and boosting its appeal to local and foreign investors.
“These are the first detailed figures confirming that the emirate’s economy has evidently overcome the repercussions of the global financial crises, posting significant growth all activities and sectors, both oil and non-oil. Growth in the GDP at current prices during 2011 surpassed all the forecasts and estimates made by local and international parties,” Scad said.

That’s the question Matt Taibbi asks at Rolling Stone. Yves Smith calls the LIBOR scandal a “huge deal”. And Robert Reich says this is the “scandal of all scandals”. I’ve gotten very angry at some of the actions of the financial sector over the last 10 years, but I am having troubling finding a good reason to “freak out” over this. I know it’s popular these days to get mad at banks every time they do something even remotely wrong, but I have a feeling the media is making a mountain out of a molehill here. My reasoning is rather simple.

On Thursday evening Sheikh Hamad bin Jassim al-Thani, who combines the roles of Qatar's prime minister and foreign minister, stood with the Duke of York and mayor of London, Boris Johnson, to watch the inauguration of the Shard. As blue and green lasers, accompanied by the London Philharmonic Orchestra, lit up a London skyline now dominated by the 310m skyscraper, the performance was streamed live around the world.

If the opening of western Europe's tallest building – presided over by Hamad, whose country's sovereign wealth fund owns 95% of the development – was a demonstration of Qatar's rapidly growing global visibility and influence, a few days before, in an equally vast but older building, that influence was being exercised far more discreetly. The building was the UN's Palais des Nations in Geneva, where last Saturday Hamad met the US secretary of state, Hillary Clinton, and other foreign ministers to press his country's case for firmer international action over Syria.

Saudi Arabian Fertilizer Co., a unit of Saudi Basic Industries Corp. rose to the highest level since May 2. Almarai Co., the kingdom’s largest food producer by market value, gained the most since June 16 after announcing an 8.7 percent increase in second-quarter net income. Jarir Marketing Co. gained the most in a week after reporting an 8.4 percent gain in quarterly earnings.

The Tadawul All Share Index (SASEIDX) advanced 0.4 percent to 6,859.59 at the 3:30 p.m. close in Riyadh. The index had declined as much as 0.7 percent during trading today.

Shares in Saudi Arabia fell for a second day, led by banks, as jobs data heightened concern about a slowing U.S. economy and Europe’s efforts to tame its debt crisis disappointed investors.
Al-Rajhi Bank (RJHI), the kingdom’s biggest bank by market value, declined for the second day. Banque Saudi Fransi, the lender partly owned by Credit Agricole SA, dropped the most since June 24, while Samba Financial Group, lost the most in a week. The Tadawul All Share Index (SASEIDX) retreated 0.1 percent to 6,831.59 as of 12:30 p.m. in Riyadh.
“There is a very uncertain global backdrop,” said Jarmo Kotilaine, chief economist at Jeddah-based National Commercial Bank. “We will get a steady trickle of bad news, which will depress markets. It is very hard to see a clear trend emerging in this situation.”